President Trump’s long-awaited infrastructure plan proposes that the federal government put up $200 billion in incentives and investments over 10 years, leaving state and local governments and private industry to come up with the rest.
Here’s a look at how the plan may pan out, and what the challenges will be in turning $200 billion into $1.5 trillion.
Mr. Trump’s infrastructure plan was unveiled Monday as the administration put forward a $4.4 trillion budget proposal for next year. The proposal, which would create deficits of at least $7.1 trillion over the next decade, includes $200 billion in #. Half of that $200 billion would go to incentives for states and cities, and the other half would go to grants, loans and bonds to fund projects.
Under the new plan, a project is eligible to receive up to 20 percent of its cost in federal funding. That means if a city or state wants to take on, say, a $1 million project, it could potentially receive up to $200,000 in federal funding if it’s able to raise the other $800,000 on its own. But states and municipalities are already paying the bulk of infrastructure costs, and would have limited options if they wanted to increase that spending, especially if they are already strapped for cash or may have trouble raising new taxes. Many would hit spending limits before they could receive all of the available federal funds over the next 10 years.
The plan represents Trump’s opening salvo in what is already shaping up to be a long and complex debate in Congress over how best to shore up the nation’s infrastructure.
he largest single piece of the White House plan is a proposed.
It would also be conceivable, in theory, for a Republican administration to propose paying for some new spending with some kind of tax increase, in which case it might lay the groundwork for a bipartisan agreement. In practice, no GOP administration has proposed doing anything like this for decades. The last Republican president to agree to a tax increase was George H.W. Bush, who did so as part of a balanced deficit reduction package that cut federal spending.
Last, a Republican president can do what Trump is doing here — propose some new spending to position himself as favoring action, while insisting that the spending be offset with spending cuts elsewhere in the budget while also not specifying which spending should be cut. That’s a formula for gridlock and inaction.
In the we the people have to pay for this infrastructure
Tell us what you think.. Do think this plan is going to work?